Times are tough for stablecoins, which are seeing their activities restricted by regulators, in the face of increasingly wary investors. This is also the case for Binance’s BUSD: its issuer Paxos is no longer authorized to make it available. Faced with this, Binance was forced to pivot, and it seems that it is the True USD (USD) which has its favor.
Binance continues to mark the distance with the BUSD
The news is not entirely a surprise to those who have been following Changpeng Zhao’s statements in recent weeks. The Binance CEO has started to distance himself from his BUSD stablecoin since the SEC forced Paxos to cease issuance of the stablecoin. He explained like this about a month ago that BUSD was not actually a native Binance project :
“BUSD is not issued by Binance. We have an agreement to let [Paxos] use our brand, but it’s not something we created.»
If the BUSD is indeed originally issued by Paxos, however, Binance’s commitment should not be underestimated for his stablecoin project. Although the current context has forced the largest exchange to mark the distance, it is still the third most capitalized stablecoin at the moment. We will therefore take with a grain of salt the words of CZ, who said the opposite last month:
“To be honest, BUSD was never a big business for us when we started. I actually thought the BUSD project might fail.»
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Binance seems to be pivoting towards TUSD
Still, Changpeng Zhao and Binance in general now want to base themselves on other stablecoins. Binance’s CEO said in February that he wanted to “include as much as possibleon the platform. And it looks like the favorite so far is TrustToken’s TUSD.
There was a 50 million TUSD issue by Binance on February 16, immediately after the start of the BUSD difficulties. And other signs have since emerged. Yesterday, the CEO of Binance announced that zero-fee exchanges between Bitcoin (BTC) and BUSD were going to be suspended, in favor of the TUSD :
Important update. Given recent events, we are moving 0 fee BTC trading from BUSD to TUSD.
Let’s spread the liquidity to more pairs.
https://t.co/6SwqjZYSFZ— CZ 🔶 Binance (@cz_binance) March 15, 2023
Users will therefore be able to take advantage of free exchanges for the BTC/TUSD pair from March 22.
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TUSD enjoys renewed global interest
In any case, the True USD stablecoin has benefited from renewed interest since the cessation of the issuance of BUSD, and the recent setbacks of the USDC. Faced with a particularly volatile environment for dollar stablecoins, the crypto community as a whole seems to have repatriated some of its liquidity to the TUSD. The capitalization of the latter has indeed skyrocketed in recent weeks:
Capitalization of the TUSD over the last three months
This corresponds to an increase in TUSD in circulation +115% over the month. Will the TUSD be able to play in the same court as its entrenched competitors? That remains to be seen, but having Binance’s favor can be particularly helpful in the crypto ecosystem.
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Sources: Binance, CoinGecko
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Journalist at Cryptoast, I fell into the pot of cryptocurrencies a few years ago. I am passionate about the innovative technologies that stem from the blockchain and I like to find the most crispy information to share with you.
Marine Debelloir
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